Several factors are relevant to determining whether a party has control over documents that are in the possession of a related nonparty for the purpose of Rule 34. In Afros S.P.A. v. Krauss-Maffei Corporation, 113 F.R.D. 127, 130 (D.Del.1986), the court identified three: (1) the corporate structure of the party/nonparty, (2) the nonparty's connection to the transaction at issue in the litigation, and (3) the degree that the nonparty will benefit from the outcome of the case. Id. at 331. Other relevant factors include whether the related entities exchange documents in the ordinary course of business, and whether the nonparty has participated in the litigation. Uniden, 181 F.R.D. at 306.

. . .

Documents in the possession of a nonparty are not automatically subject to discovery under Rule 34 simply because the nonparty has a corporate relationship to a party to the litigation. Ordinarily, a party seeking the production of documents from a nonparty must provide specific facts demonstrating that some or all of the foregoing factors of control are present. Cotracom Commodity Trading Co. v. Seaboard Corp., 189 F.R.D. 655, 663 (D.Kan.1999). See also Uniden, 181 F.R.D. at 307 ("if the factors are present, then an inference of control is found."). Because the burden of proof rests with that party seeking production, therefore "[a]n unsubstantiated assertion [of control] generally does not suffice." Id. The burden may shift, however, when the party from whom production is sought fails to respond to assertions of control when given the opportunity to do so. Cotracom, 189 F.R.D. at 663.

Tuesday, November 28, 2006

N.D. Georgia Holds Party Seeking Removal Under CAFA Has the Burden of Establishing Jurisdiction

As an initial matter this court must determine who has the burden of proof in establishing subject matter jurisdiction. The defendants contend that CAFA changed the tradition notion that removal is not favored and that CAFA "should be read broadly, with a strong preference that in interstate class actions should be heard in a federal court if properly removed by any defendant." ING Clarion Partners, LLC's Response in Opposition to Plaintiffs' Motion to Remand Case and for Evidentiary Hearing at 5, quoting S.Rep. No. 109-14, at 43, 2005 U.S.C.C.A.N. 3, 41. The defendants specifically refer to certain comments made by Representative Sensenbrenner wherein he said that the provisions strongly favor the exercise of federal jurisdiction.The problem with this argument is that it has been specifically considered and rejected by the Eleventh Circuit. In Miedema v. Maytag Corp., 450 F.3d 1322 (11th Cir.2006), the Eleventh Circuit considered the legislative history of CAFA and the statements of Representative Sensenbrenner with respect to who had the burden of establishing jurisdiction and concluded that the burden remained with the person seeking removal. The court noted that a committee report could not serve as an independent statutory source having the force of law, citing United States v. Thigpen, 4 F.3d 1573 (11th Cir.1993) (en banc).

In Miedema, the court also rejected the argument "based on the legislative history described above, that the district court should have resolved any doubts about the amount in controversy in favor of finding jurisdiction." 450 F.3d at 1328. "The rule of construing removal statutes strictly and resolving doubts in favor of remand ... is well-established.... Statements in CAFA's legislative history, standing alone, are an insufficient basis for departing from this well-established rule." Id. at 1328-29. But see Evans v. Walter Industries, 449 F.3d 1159 (11th Cir.2006) (using the same legislative history to support its conclusion that Congress contemplated broad federal court jurisdiction).

In sum, because Erie does not apply to acts of Congress, the substance/procedure dichotomy embodied in that doctrine is inapplicable to the Federal Rules of Evidence as originally enacted. Further, because an act of Congress is subject to neither the Rules Enabling Act nor the Rules of Decision Act, these Acts do not work to limit the applicability of the unamended Federal Rules of Evidence in the face of conflicting state law.

. . .

Where a state law excludes certain evidence in order to effect substantive policy considerations, Rule 401 acts to exclude the evidence since the proposition for which the evidence is submitted is not properly provable and, therefore, irrelevant to the claim. See Huff v. Shumate, 360 F.Supp.2d 1197 (D.Wyo.2004) (holding that although the Federal Rules of Evidence apply, the Rules nonetheless bow to state substantive policy based on the relevancy requirement of Rules 401 and 402); see also Jack B. Weinstein & Margaret A. Berger, Weinstein's Federal Evidence, § 401.04[3] [b] (Joseph M. McLaughlin ed.2006). For example, state law defines the elements and defenses of a cause of action in a diversity case. If, in such a case, a defendant proffers evidence supporting a defense that is no longer permitted by state statute, that proffer is of no consequence to the action and therefore not properly provable.

In sum, although we find that the Federal Rules of Evidence are not subject to Erie's substance/procedure distinction, this distinction still has meaning in making evidentiary determinations in federal diversity cases.

Friday, November 24, 2006

Judge Easterbrook recently had the chance to note a circuit split in a concurring opinion in Rivera v. City of Chicago, --- F.3d ----, 2006 WL 3360536 (7th Cir. 2006):

"The court sensibly rejects Chicago's proposal to overrule Badillo v. Central Steel & Wire Co., 717 F.2d 1160 (7th Cir.1983), and its successors, which allow district judges to excuse unsuccessful but indigent litigants from paying costs under Fed.R.Civ.P. 54(d). Whether indigent litigants must be ordered to pay statutory costs is a subject that has divided the circuits. Only the Supreme Court or an amendment under the Rules Enabling Act can produce national uniformity; there is little point in our moving restlessly from one side of the conflict to the other."

Wednesday, November 22, 2006

SCOTUS Denies Review in Civil Procedure Cases

Here is a listing of some of the cases denied review by the Supreme Court this week touching on civil procedure topics as reported by BNA's Supreme Court Today:

Tokio Marine & Fire Insurance Co. v. Ito, 166 Fed.Appx. 932 (9th Cir.) (Forum non conveniens)Review Denied: 11/13/2006 (74 U.S.L.W. 3722)Question Presented: Did the Ninth Circuit's decision to reverse district court's decision to dismiss action, on ground of forum non conveniens, by U.S. citizen against a Japanese insurer, conflict with decisions of other circuits with respect to standard of proof, violate public policy, and ignore concerns of comity?Summary of Ruling Below: The district court abused its discretion when it dismissed, on the basis of forum non conveniens, an action by U.S. citizen injured in car accident in Japan, alleging breach of insurer's agreement to pay medical costs incurred by her in United States. The district court failed to require the defendant to make a clear showing of facts required to merit forum non conveniens dismissal. Additionally, the district court improperly balanced the private and public interest factors by (i) failing to give any deference to plaintiff's U.S. citizenship and choice of home forum, (ii) improperly relying on allegedly numerous witnesses and documents in Japan rather than assessing relevance and materiality of proposed testimony and documents to allegations of complaint, (iii) failing to accord proper weight to California's interest in protecting its citizens and ensuring that they are compensated for injuries occurring in California, and (iv) improperly analyzing issue of court congestion by commenting on congestion in U.S. District Court for Central District of California without considering whether Japan provided speedier forum. Based on reweighing of private and public interest factors, Japan is not a more convenient forum for this action and thus plaintiff may pursue her action in forum that she selected.

Communication Bridge Global Inc. v. Chow, 2006 WL 466668 (Cal. Ct. App.) (Default Judgment)Review Denied: 11/13/2006 (75 U.S.L.W. 3220)Question Presented: When a corporation's two successive attorneys' gross malpractice and repeated positive misconduct caused default judgment to be entered against their client corporation, and that corporation, then insolvent, cannot afford third attorney, is it appropriate to grant the corporation equitable relief, when corporation applies for relief from default immediately after obtaining new legal counsel?Summary of Ruling Below: Corporation that waited more than two years before moving to set aside a default judgment that had been entered against it, allegedly on the basis of extrinsic fraud because it lacked funds necessary to hire an attorney, demonstrated lack of diligence that precludes grant of motion.

Tuesday, November 21, 2006

As a preliminary matter, the Court considers whether it must address the jurisdictional objections raised by Defendants' motions before reviewing their grounds to dismiss under the doctrine of forum non conveniens. This question presents two issues that, with conflicting results, have arisen with some frequency in this context. First is whether a dismissal warranted by forum non conveniens constitutes a merits-based decision and therefore, consistent with the bounds of Article III of the federal Constitution, the doctrine cannot be applied without a prior adjudication of the court's subject matter jurisdiction. The second issue is whether, even if the rule implicates no determination on the merits of dispute, the Court nonetheless must address the forum question sequentially after confirming that it possesses jurisdiction over the subject matter and over the parties. A substantial Circuit Court split now exists concerning these questions.

In Dominguez-Cota v. Cooper Tire & Rubber Co., the Fifth Circuit ruled that it was unable to characterize forum non conveniens as a "non-merits" issue because in assessing a motion for dismissal on forum non conveniens grounds the court necessarily " 'becomes entangled in the merits' " of a dispute, and therefore a forum non conveniens determination could not be made before the court confirmed its subject matter jurisdiction. 396 F.3d 650, 654 (5th Cir.2005) (quoting Van Cauwenberghe v. Biard, 486 U.S. 517, 528 (1987)). In an earlier case examining the same issue, the D.C. Circuit reached an opposite result. See In re Papandreou, 139 F.3d 247 (D.C.Cir.1998). It concluded that a finding of forum non conveniens is "merits-free," and therefore a dismissal on such grounds before the Court's determination of subject matter jurisdiction "makes no assumption of law-declaring power that violates the separation of powers principles." Id. at 255.

The Second Circuit pronounced its position on these questions in Monegasque de Reassurances S.A.M. v. NAK Naftogaz of Ukraine, 311 F.3d 488 (2d Cir.2002). Subscribing to the reasoning in Papandreou, it held that neither it nor district courts in this Circuit are barred from bypassing questions of jurisdiction and proceeding directly to rule on an invocation of forum non conveniens, at least where any jurisdictional challenge does not implicate a threshold constitutional question. See id. at 497 (citing Fama v. Commissioner of Corr. Servs., 235 F.3d 804, 816 n. 11 (2d Cir.2000)). More recently, in Dattner v. Conagra Foods, Inc., the Second Circuit, noting the Circuit split on these issues and disagreeing with the contrary view articulated by the Fifth Circuit, reaffirmed its finding in Monegasque that a forum non conveniens dismissal "is a non-merits decision akin to dismissal for lack of personal jurisdiction," and hence requires no antecedent verification of jurisdiction. 458 F.3d 98, 102 (2d Cir.2006) (per curiam). . . .

Nonetheless, Monegasque represents the law in this Circuit on this subject, and the Court accordingly follows it in proceeding below to consider directly Defendants' invocation of forum non conveniens.

Monday, November 20, 2006

The Casino did not waive immunity when it provided in Allen's employment application that he could be terminated "for any reason consistent with applicable state or federal law," or when it stated in the Employee Orientation Booklet that it would "practice equal opportunity employment and promotion regardless of race, religion, color, creed, national origin ... and other categories protected by applicable federal laws." These statements are not a "clear" waiver of immunity. See C & L Enters., Inc. v. Citizen Band Potawatomi Indian Tribe, 532 U.S. 411 (2001). At most they might imply a willingness to submit to federal lawsuits, but waivers of tribal sovereign immunity may not be implied. See Santa Clara Pueblo v. Martinez, 436 U.S. 49, 58 (1978) (explaining that a waiver of immunity "must be unequivocally expressed").

In September 2002, Martha Louise Piggee, who was then a part-time instructor of cosmetology at Carl Sandburg College, gave a gay student two religious pamphlets on the sinfulness of homosexuality. The student was offended and complained to college officials. After the college looked into the matter, it found that Piggee had sexually harassed the student. It admonished her in a letter to cease such behavior, and the following semester it chose not to retain her. . . .

. . .

The district court . . . thought that Piggee lacked standing to ask for an injunction against the college's actions, because by the time she filed her complaint in October 2003 she had already been off the college's payroll for a year. Insofar as she was seeking prospective equitable relief, we agree with the district court that the possibility of any future injury was indeed too remote. Piggee responds only that she remains on the substitute teacher list, and thus that she could be called up any time. But she has not been invited to teach at Carl Sandburg College since December 2002. We conclude that she cannot show that she "is immediately in danger of sustaining some direct injury as a result of the challenged official conduct and the injury or threat of injury ... is both real and immediate, not conjectural or hypothetical."

Second Circuit Holds a Broker Does Not Have Standing as a Plaintiff Under the Commodity Exchange Act

[The Commodity Exchange Act (CEA)] § 22 enumerates the only circumstances under which a private litigant may assert a private right of action for violations of the CEA. . . . The text . . . requires that a putative plaintiff fall within one of the four required relationships set forth in § 22(a)(1)(A-D).

. . .

The common thread of these four subdivisions is that they limit claims to those of a plaintiff who actually traded in the commodities market. Specifically, the remedies afforded by CEA § 22(b) are available only to a private litigant "who engaged in ... transaction[s] on or subject to the rules of" a contract market. Id. § 25(b)(1)-(3). . . .

Klein does not fall within any of the required subdivisions of § 22(a)(1)(A)-(D). . . .

. . . . Klein functioned merely as a broker or agent that earned commissions for handling its customers trades. As a clearing member, Klein cleared their trades and was obligated to post margins for them as required. Under NYCC Rules governing clearing members, Klein was liable for its own failure to post the required margin on its customers' positions, whether or not Klein collected that margin from defaulting customers such as First West. In view of the provisions of sections 22(a) and (b) expressly limiting the categories of persons that can seek remedies under the statute we conclude, as did the court below, that a plaintiff such as Klein who falls outside those categories lacks standing.

Wednesday, November 15, 2006

Having dealt with the merits of defendants' appeal, we turn now to plaintiffs' cross-appeal. Plaintiffs ask this Court to exercise pendent jurisdiction over a number of claims. . . . Under the collateral order doctrine, "a district court's denial of a claim of qualified immunity, to the extent that it turns on an issue of law [and not of fact], is an appealable 'final decision' within the meaning of 28 U.S.C. § 1291 notwithstanding the absence of a final judgment." Mitchell v. Forsyth, 472 U.S. 511, 530, 105 S.Ct. 2806, 86 L.Ed.2d 411 (1985). When we take such an appeal, we may exercise pendent jurisdiction over other issues that are not ordinarily subject to interlocutory review only when: (1) they are "inextricably intertwined" with the determination of qualified immunity; or (2) their resolution is "necessary to ensure meaningful review" of the district court's ruling on qualified immunity. Swint v. Chambers County Comm'n, 514 U.S. 35, 51, 115 S.Ct. 1203, 131 L.Ed.2d 60 (1995); see also id. at 4, 115 S.Ct. 12039 (cautioning that "a rule loosely allowing pendent appellate jurisdiction would encourage parties to parlay [appealable] collateral orders into multi-issue interlocutory appeal tickets"). Finally, we are mindful that "[p]endent appellate jurisdiction is a procedural device that rarely should be used because of the danger of abuse" and that accordingly, we must exercise such jurisdiction "[o]nly in exceptional circumstances." Natale v. Town of Ridgefield, 927 F.2d 101, 104 (2d Cir.1991) (citation omitted).

Each finding on which plaintiffs seek to cross appeal involves issues entirely separate and distinct from the qualified immunity analysis at issue here, including the district court's determinations on the subjective intent in plaintiffs' conspiracy claims, see Crawford-El v. Britton, 523 U.S. 574, 588, 118 S.Ct. 1584, 140 L.Ed.2d 759 (1998) (articulating a "single objective standard" for evaluating qualified immunity and stating that "[e]vidence concerning the defendant's subjective intent is simply irrelevant to that defense"); on plaintiffs' failure properly to include defendants in their captions; on claims of parties who are not before this court on appeal, see Kaluczky v. City of White Plains, 57 F.3d 202, 207 (2d Cir.1995) ("[A] claim involving a 'pendent party' is an 'unrelated question' that cannot be resolved under pendent jurisdiction."); and on issues of respondeat superior and supervisor liability, see Swint, 514 U.S. at 51, 115 S.Ct. 1203 (finding no pendent jurisdiction over county commission's appeal where "[t]he individual defendants' qualified immunity turns on whether they violated clearly established federal law [while] the county commission's liability turns on the allocation of law enforcement power in Alabama"). Thus, we have no jurisdiction over plaintiffs' cross-appeal because there are no issues before us "inextricably intertwined" with our qualified immunity analysis.

Plaintiffs brought a putative class action against their former attorneys . . . . Both firms had served as class counsel in a separate earlier securities class action and it is the firms' conduct in litigating the securities action that is now alleged by the plaintiffs to have constituted malpractice. The district court dismissed the malpractice complaint for failure to state a claim. . . . We remanded to the district court for the limited purpose of having it explain its basis for exercising subject matter jurisdiction over the action. The district court subsequently identified three possible bases for subject matter jurisdiction: (1) the terms of an injunction it entered in the underlying securities class action pursuant to its authority under 28 U.S.C. § 1651; (2) diversity jurisdiction if non-diverse plaintiffs are dismissed as unnecessary parties; and (3) supplemental jurisdiction under 28 U.S.C. § 1367(a). While we are querulous as to the first two contentions, we agree that supplemental jurisdiction exists.

There is no good reason to strain to give a different meaning to the identical language in the diversity and federal-question statutes. The best contemporary reasons for keeping federal courts out of the business of probating wills, resolving will contests, granting divorces and annulments, administering decedents' estates, approving child adoptions, and the like are two, and they are as persuasive when a suit is filed in federal court on the basis of federal law as when it is based on state law. First, the proceedings we have listed, or at least those involving child custody and probate administration, are in rem in character--they are fights over a thing of value that is in the court's control--and another court should not try to elbow its way into the fight. Second, state courts are assumed to have developed a proficiency in these matters, to have procedures tailored to them, and to work closely with and even employ specialized staff not found in federal courts. Ankenbrandt v. Richards, supra, 504 U.S. at 703-04, 112 S.Ct. 2206;Lloyd v. Loeffler, supra, 694 F.2d at 492, 13B Wright, Miller & Cooper, supra, at 461. This case, involving as it does a fight over an estate in the control of the state probate court, and the deployment of the public guardian, illustrates both points. See Ankenbrandt v. Richards, supra, 504 U.S. at 703-04, 112 S.Ct. 2206. And since state courts are authorized to decide issues of federal law unless Congress decrees otherwise, confining a class of federal-law cases to state courts does not deprive litigants of their federal rights.

Friday, November 10, 2006

Seventh Circuit Holds Claims for Denial of Access to the Courts Do Not Need to be Plead with Particularity

The plaintiff in this state prisoner's civil rights suit claims that prison officials violated his constitutional right to access to the courts. . . . The district judge dismissed the suit on the ground that the plaintiff had failed to plead a claim of denial of access to the courts with the requisite particularity--failed to "provide more than general allegations that defendants hindered his ability to pursue these or any other non-frivolous legal actions."

In so ruling the judge relied primarily on Ortloff v. United States, 335 F.3d 652, 656 (7th Cir.2003), which holds that to avert dismissal on the pleadings the plaintiff in a denial of access case "must make specific allegations as to the prejudice suffered because of the defendants' alleged conduct." He must do this "because a right to access-to-courts claim exists only if a prisoner is unreasonably prevented from presenting legitimate grievances to a court; various resources, documents, and supplies merely provide the instruments for reasonable access, and are not protected in and of themselves. Thus, when a plaintiff alleges a denial of the right to access-to-courts, he must usually plead specific prejudice to state a claim, such as by alleging that he missed court deadlines, failed to make timely filings, or that legitimate claims were dismissed because of the denial of reasonable access to legal resources."

The list in Rule 9(b) of claims that must be pleaded with particularity doesnot include claims of denial of access to the courts, and so in Nance v. Vieregge, 147 F.3d 589, 590-91 (7th Cir.1998), we had held (as noted in Thomson v. Washington, supra, 362 F.3d at 971) that there is indeed no heightened-pleading requirement for such claims. And shortly after the decision in Ortloff, another panel of this court had stated the pleading requirement for a denial of access claim thus: "In order to avoid dismissal ... [plaintiff] therefore had to allege that he had a non-frivolous legal claim that was frustrated or impeded by [defendant's] failure to assist him in the preparation and filing of meaningful legal papers and that he was harmed by [defendant's] action (or lack thereof)." Lehn v. Holmes, 364 F.3d 862, 868 (7th Cir.2004). This is the language of notice pleading, not, as in Ortloff, of fact pleading, notice pleading being all that is required of claims that don't fall within the scope of Rule 9(b).

Wednesday, November 08, 2006

Eleventh Circuit Affirms Sanction of Dismissal With Prejudice for Plaintiff Who Used False Identity in Filing Complaints

The plaintiff contends that the record contains no evidence that his use of a false name was willful instead of merely negligent. We disagree for the reasons the district court set out in its detailed findings of fact. Our review of that court's findings is only for clear error, and here there clearly is none. The court convincingly rejected each of the arguments that the plaintiff's counsel put forward against a finding of willfulness, and we adopt its reasoning. The plaintiff did not merely slip up. He followed a pattern of deception for a period of at least six years from the time he got the driver's license in 1996 through multiple arrests, convictions, and incarcerations, and filed more than thirty pleadings and motions under a false name in this case. At least some of those pleadings and motions were filed under penalty of perjury. All of them hid his actual identity. Not until the pretrial proceedings were completed and a jury was in the box did the plaintiff finally own up to who he really is.

A trial is not a masquerade party nor is it a game of judicial hide-n-seek where the plaintiff may offer the defendant the added challenge of uncovering his real name. We sometimes speak of litigation as a search for the truth, but the parties ought not have to search for each other's true identity. Rule 10(a) requires that the name of the parties be disclosed in the complaint; Rule 11 forbids lying in pleadings, motions, and other papers filed with the court; and Rule 41(b) provides for dismissal with prejudice as the ultimate sanction for violation of the rules. Fed. R. Civ. Pro. 10(a); Fed. R. Civ. Pro. 11; Fed. R. Civ. Pro. 41(b).

That brings us to the second reason the plaintiff asserts against the district court's order of dismissal. The plaintiff contends that the dismissal was improper because the district court did not explicitly consider lesser sanctions and reject them as inadequate. In addition to finding willful contempt, a district court must consider the possibility of alternative, lesser sanctions. Betty K Agencies, Ltd., 432 F.3d at 1339. However, we have made clear that such consideration need not be explicit. Gratton v. Great Am. Commc'ns, 178 F.3d 1373, 1374 (11th Cir.1999) ("Dismissal under Rule 41(b) is appropriate where there is ... an implicit or explicit finding that lesser sanctions would not suffice."); Goforth v. Owens, 766 F.2d 1533, 1535 (11th Cir.1985) ("The record also supports an implicit finding that any lesser sanction than dismissal would not have served the interests of justice.").

It is true that the district court did not explicitly consider and reject lesser sanctions, but a determination that no other sanction would suffice radiates from its explanation for the dismissal. No point would be served by remanding for the court to make explicit that which is inescapably implicit. And the court's implicit determination is correct. Nothing short of putting the plaintiff out of court will properly punish his serious and protracted violation of the rules and adequately deter future violations by other parties. As the Seventh Circuit explained in a similar case, "[f]iling a case under a false name deliberately, and without sufficient justification, certainly qualifies as flagrant contempt for the judicial process and amounts to behavior that transcends the interests of the parties in the underlying action." Dotson v. Bravo, 321 F.3d 663, 668 (7th Cir.2003). It is conduct that "so violates the judicial process that imposition of a harsh penalty is appropriate not only to reprimand the offender, but also to deter future parties from trampling upon the integrity of the court." Id.; see also Goforth, 766 F.2d at 1535 ("[W]here any other sanction would fail to cure the harm ... dismissal can be appropriate."). Permitting the plaintiff to pursue his claim would take the punch out of the punishment for pummeling the probity of the judicial system.